Jul 2 Personal Finance Book List: Edition #2

I absolutely love to read, and recommending books to others is an absolute joy. Today I want to introduce you to some fantastic books that I’ve read recently, to read on your personal finance journey. They cover a range of topics from FIRE to frugalism.

After borrowing this book from the library and carrying it around in my work bag for a week, I finally took the time to read this book over the long-weekend. The book is a perfect way to introduce someone brand new to the FIRE (Financial Independence Retire Early) movement, as it succinctly covers the main concepts of FIRE (with an American slant of course — just ignore the 401k stuff).

Scott highlights a useful exercise when getting started by writing down the 10 things that have brought you happiness in the last week, and then reflecting on what you’ve written. Then write a list of the top 10 things you spend the most money on each month, and compare it to the first list. Scott then prompts you to examine if you’re spending money on the things that actually bring you happiness, and where your priorities actually fit in with your spending.

“Once upon a time, thrift and frugality were celebrated as virtues. Yet somewhere, somehow, frugal became a dirty word. I want to reclaim it. Instead of being equated with negative words such as poor, meagre, paltry, cheap, insufficient or even skimpy, I want frugality to be associated with concepts such as creativity, appreciation, abundance, choice, empowerment and being enterprising and environmentally sound.”

This book is a fantastic resource written from an Australian perspective, which is rare when it comes to books relating to our personal finances. The book highlights hundreds of ways you can be creative and clever with your time, money and resources, to help you live a better and brighter life on any budget. Serena highlights the difference between being frugal and being cheap, and reinforces that you can still be a generous person even if you don’t spend a lot of money.

“By empowering myself, I am also empowering my children, family and friends, showing them that having finances in good shape brings security and provides options.”

Alongside many useful tips, The Joyful Frugalista reminds you of the importance of living with intention, and focusing on the here and now. Serena highlights that ‘when you have a handle on your finances, you have the resources and confidence to do amazing things with your life’, and that is something I wholeheartedly agree with!

“Money can’t buy love, but it does buy power and choices. Money gives us choices about where to live, and enables us to follow our dreams. Money can enable you to go and do what you want with confidence. You can control money; it doesn’t control you.”

“The millionaires profiles in this book did it slowly, steadily, without signing a multimillion dollar contract with the Yankees, without winning the lottery, without becoming the next Mick Jagger.”

I found this book a fascinating insight into the lives of millionaires, and the fact that most of them spend very little on materialistic items, rather focusing on putting their money towards income producing assets. Although the research for this book was done in America, it’s interesting to note that the average millionaire is happy with their life (90%), doesn’t spend more than $50 on jeans, has a college degree (93%) and knows how much they spend every year (70%). The book also reminds the reader that income isn’t wealth, but you can transform you income into wealth through accumulating assets over time.

“A lifestyle that is dictated by what others do, drive, and wear cannot be sustained by most without a steady fire hose of incoming cash flow. Many of us simply accept our current habits, or refuse to do the hard work to change them, all the while complaining and often giving in to a life of dependency and worry.”

Another useful aspect of the book is the insights into the behaviours and traits of the Americans who achieve millionaire status, and provides case studies into the way the live their lives. I would definitely recommend this book to a friend, because the lessons from this book are so much more powerful if implemented from an early age.

“What does being financially independent — not beholden to debt repayments, an employer, or a paycheck — allow you to do? It grants you freedom. You are free to solve problems the way you see fit; free to volunteer or spend time with your family; free to take a job that perhaps pays less but gives you more satisfaction; free to create your own opportunities.”

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